The present day Soviet State, as a collective capitalist,
administers the means of production in the name and the interest of the
new Soviet bourgeoisie. The socialist common ownership has turned into
a state capitalism of a new type.

Enver Hoxha

The Soviet Economy – A Completely and
Definitely Capitalist Economy

By Aristotel Pano

Economist, lecturer at the Tirana
University.

Life, time has always been the best judge of the correctness
of the conclusions of our party in all questions. It has demonstrated
their incalculable value and historic importance. This is just what
occurred also with the conclusions concerning the restoration of
capitalism in the Soviet Union.

1

Without doubt the great ideological betrayal and the
usurpation of the leadership of the CPSU by a group of traitors which
took its open form at the ill-famed 20th Congress of the CPSU
constituted the prologue to the restoration of capitalism in the Soviet
Union. This group of traitors, headed by Khrushchev, began the process
of the degeneration of the dictatorship of the proletariat that existed
in the Soviet Union, into a dictatorship of the new Soviet bourgeoisie
which began to emerge.

The entire superstructure of Soviet society degenerated. The former
dictatorship of the proletariat was transformed into a savage fascist
dictatorship of the new revisionist bourgeoisie, the socialist Soviet
State was transformed into a social-imperialist state. Although the
beginning of the process of the degeneration of the Soviet
superstructure was also the beginning of the restoration of capitalism,
this degeneration of the superstructure could not advance itself
without the degeneration of the economic base. Therefore, with the
beginning of the process of the degeneration of the superstructure, the
process of the degeneration of the economic base began, too. Here we
have to do with a dialectical and complicated interaction of the
degeneration of the superstructure and the base, where the one pushed
ahead and impelled the other, until at last they assumed their complete
capitalist form. Also in the question of the degeneration of the
socialist relations of production into capitalist relations, just as
our Party has pointed out in its documents, the treacherous
Khrushchovian leaders exploited some shortcomings which existed,
especially in the relations of distribution (the great discrepancy of
salaries, which our Party has rightfully described as a dangerous evil).

It is known that capitalism is the highest and most general stage of
commodity production. With scientific genius Marx proved in his work
“Capital” that wherever commodity production becomes general and
flourishing, there capitalist exploitation comes into being
spontaneously. Therefore, in his work “Capital”, Marx begins his whole
analysis of capitalism “precisely with his analysis of the commodity.
Defending and further developing Marx's economic theory Lenin
underlined that:

“The essential features of capitalism, (author's emphasis) according to
his theory, are: (1) Commodity production, as the general form of
production. The product assumes the form of a commodity in the most
varied organism of social production, but only in capitalist production
is this form of the labour product general and not exceptional,
isolated, accidental. (2) The second characteristic of capitalism is
the fact that not only the product of labour, but also labour itself,
i.e. human labour power, takes the commodity form. The degree to which
the commodity form of labour power is developed is an indication of the
degree to which capitalism is developed”.

After the usurpation of the leadership of the Soviet Party and State,
the Soviet revisionist traitors in a camouflaged way, created objective
conditions for the emergence and development of the above two features
in the Soviet economy. And in as much as any practical activity
requires prior ideological preparation, after 1953, the first thesis
attacked by the Soviet revisionists in the Marxist economic theory was
that about commodity production and the law of value in socialism.

It is well known that Marxism-Leninism does not negate the necessity of
the existence of commodity production after the seizure of state power
by the working class. On the contrary, in the first stage, this form of
production exists objectively, but being a vestige of capitalism, it is
never allowed to extend and flourish; on the contrary, with the
extension and strengthening of the socialist sector of the economy,
with the maturing of the socialist relations of production the sphere
of commodity production and of the operation of the law of value is
also narrowed and limited, until objective conditions are finally
created for their complete liquidation. While they consider commodity
production as inevitable for a certain time, the genuine
Marxist-Leninist Party and the socialist state of the working class are
also aware of the danger it conceals, and take conscious measures for
the creation of the objective conditions for its final liquidation in
the future.

But in opposition to all this, with the aim of concealing the process
of the restoration of capitalism with demagogic phrases, after the year
1953, the Soviet revisionist traitors brought out the diabolical thesis
that before they cease their operation, and in order to bring about
this cessation, the old categories inherited from capitalism (thus
including commodity production and the law of value) must be developed
and flourish in a full and general way.

In the impossibility of presenting here all the "scientific arguments”
for this diabolic thesis, suffice it to mention that in a camouflaged
manner, it found its expression in the so-called “Programme of the
Communist Party of the Soviet Union”, which was approved at the 22nd
Congress of this party, which says:

As is seen, in opposition to the entire Marxist-Leninist theory, which
stresses the indispensability of the limitation and restriction of
commodity production during the transition to communism, the Soviet
revisionists, as conscious traitors to Marxism wanting to conceal the
process of the restoration of capitalism, speak of “full utilization”
of commodity-money relations in communist construction. As to what is
the meaning of the words “full utilization”, this emerged clearly from
all the practical economic measures they adopted, which are measures
for the transformation of socialist production into capitalist
commodity production. All the “theoretical” creations and practical
measures of these renegades were blatant betrayal of the precepts of
Marxism-Leninism which they claim they are “developing”.

Here, concretely is what Lenin stresses:

“Marxism teaches us that the society, which is based on commodity
production... at a certain level of development, inevitably, takes the
road of capitalism”, (author's emphasis).

And precisely the measures taken by the Soviet revisionists after the
year 1953 in the economic field, along with the process of the
degeneration of the superstructure, objectively created that certain
level of development of commodity production which brought about the
birth of capitalism in the economy, which has now been completely and
definitely formed.

All the concrete measures of the Soviet revisionists after the year
1953 in the field of the economy, which reached their culmination in
1965 with the so-called “economic reform”, had one aim: the restoration
of the capitalist economy of commodity production. Irrespective of
“Marxist” phraseology with which these measures have been justified, or
how their capitalist essence has been concealed from the working
people, in essence they were measures for the reestablishment of
capitalism which has now been completed. At various periods these
measures have affected production, distribution, exchange, the
management of the economy, etc., but in their entirety they express one
thing: the degeneration of the socialist economy, the unlimited
extension of the commodity-money relations, the creation of the economy
of capitalist commodity production, the creation of conditions for the
emergence and operation of all the categories of the capitalist economy
which will be mentioned below.

The most important element in the whole process of the extension and
flourishing of capitalist commodity production in the Soviet Union was
precisely the transformation of labour power into a commodity. Marxism
teaches us that “capitalism is that stage of the development of
commodity production when even labour power, becomes a commodity”.
Precisely because this process of the transformation of labour power
into a commodity has been completed in the Soviet Union, it is
understandable that we have to do here with a completely capitalist
economy.

For labour power to become a commodity it is necessary for the worker
to be divested of all means of production and be obliged to sell only
his labour power. The process of divesting the Soviet labour force of
the means of production, has been the very process of the degeneration
of the dictatorship of the proletariat into a dictatorship of the new
Soviet bourgeoisie. Thus, with the degeneration of the Soviet State,
with its transformation into a dictatorship of the new Soviet
bourgeoisie, the means of production too, which were state or
collective farm property, were automatically transformed into property
of the new revisionist bourgeoisie, which usurped the state power. The
Soviet working class was deprived of the means of production, it no
longer has anything to sell for its livelihood but its labour power,
which like all the other factors of production, has been transformed
into a commodity.

In order to become convinced that the character of the state property
depends on the character of the state itself, on whose hands the state
is in, suffice it to cast a glance on the present day reality of the
western capitalist states, where state ownership has been extended in
recent years. Nobody thinks .of considering the state ownership
existing today in the western capitalist states as socialist ownership,
ownership by the workers. Why? Because state ownership is always the
ownership of that class which holds the state power. And as long as the
state power is in the hands of the bourgeoisie, of the capitalists,
state ownership, too, is a form of capitalist ownership, is state
monopoly capitalism.

In essence, we have the same thing also in the Soviet Union. It is not
superfluous to note here that a century ago, in his work
"Anti-Dühring”, Engels pointed out that the character of state
ownership depends on whose hands the state is in.

Of course, the transformation of socialist ownership into state
capitalist ownership of a special type, and of labour power into
commodity did not take place in the Soviet Union at the touch of a
magic wand, but through a whole process of the degeneration of the
dictatorship of the proletariat into a dictatorship of the new
revisionist bourgeoisie.

In as much as the processes of the degeneration of the superstructure,
of the change of the character of ownership, of the transformation of
labour power into a commodity, of the extension and flourishing of
capitalist commodity production were completed, the process of the
restoration of capitalist exploitation, too, in all its breadth and
depth, was automatically completed in the Soviet Union. This was the
inevitable result of the restoration of the capitalist commodity
production. Here is what Marx teaches us:

"To the extent that commodity production develops in conformity with
its inherent laws into capitalist production, to the same extent the
property laws of commodity production are turned into .laws of
capitalist appropriation”.

2

Now there is no doubt that the main form of capitalism in the
Soviet Union is state monopoly capitalism of a new type. But this “new
type” does not mean at all that we have to do with another essence of
capitalism. The new type consists only in the way of its birth and its
role, while as far as its essence is concerned, it is capitalism as in
all the capitalist countries.

State capitalism in the western countries came into being mainly as a
result of nationalisations with compensation carried out by the
bourgeois state, whereas in the Soviet Union it came into being through
the completion of the process of the degeneration of the dictatorship
of the proletariat into a dictatorship of the new bourgeoisie. In the
western capitalist countries, state capitalism plays a role dependant
on private capital, as a tool of the latter, while in the present-day
Soviet Union it plays the dominant and principal role.

But while stressing the fact that the main form of capitalism in the
Soviet Union is state monopoly capitalism of a special type, we must
mention the other forms of capital and capitalism existing there today.

As a result of the fat salaries which the new Soviet bourgeoisie
receives in the state and collective farm sector, it manages not only
to lead a fabulous life, but also to create colossal "savings” in the
form of deposits, which, by means of interest, “give birth” to other
money. Here it is not a question of denying the possibility of savings
in socialist society. Naturally, parallel with the increase of general
wellbeing, the working people also create savings in order to better
fulfil their needs of consumption in the future. But when these savings
belong only to “people with special abilities”, when they stem from the
exceptionally high salaries and bonuses they receive, and yield large
sums of interests, they are no longer savings, but loan capital, money
which gives birth to money.

Here is what Lenin says:

“The starting point of any capital, – both industrial and commercial –
is the formation of free financial means in the hands of individual
persons (the words “free means” should be understood as those financial
means which are not necessarily used for personal consumption, etc)”.

Today, the new Soviet bourgeois and a part of the worker aristocracy
possess almost 60 billion roubles of deposits, bringing in 2 billion
roubles interest annually, without even lifting a finger. The formula
of capital, loan P–P', demonstrated by Marx a century ago, is precisely
the formula of these “savings” of the new Soviet bourgeoisie.

But this is not the only form of private monetary capital possessed by
the new Soviet bourgeoisie. There are also other forms, in the form of
state obligations, insurance, etc. Finally, we cannot fail to mention
another form of commodity production which gives birth every day to new
capitalists in the Soviet Union, which involves the so-called
.collective farmer's personal plot”. No Marxist has denied that as long
as the agricultural cooperatives are unable to fulfil some of the needs
of their members, the cooperativists must have a personal plot of land
for some of their family needs. But when this “personal plot” is
extended beyond measure and is used not for personal needs, but to
supply the market, then it is turned into an economy of simple
commodity production which, .as Lenin has said, every minute, every
hour, and every day, gives birth to capitalism. This is precisely the
type of the economy of a large number of “collective farmers' personal
plots” in the present-day Soviet Union. These “personal plots” today
supply up to 60 per cent of the vegetables, 80 per cent of the fruit,
etc. Therefore, as commodity production economies, they give birth to
new capitalists every day.

3

The analysis of the capitalist character of the Soviet economy
must be done not on the basis of external appearances, of the demagogy
of the traitors to Marxism, of the laws and juridical forms which still
preserve the “socialist” shell, but in the way in which the classics of
Marxism-Leninism, the Party of Labour and comrade Enver Hoxha teach us,
on the basis of the real economic relations.

Criticising the Narodniks, Lenin taught the Marxists:

“In order to define the ‘type’ (of an economy – A. Pano) we must
naturally, consider the principal economic features of an order and not
its juridical forms”. And the economic reality of the Soviet Union
today is such that, without having in their pocket any deed entitling
them to ownership of the country's means of production but thanks to
their actual position, the new revisionist bourgeoisie use these means
for the exploitation of the working class, for the capitalist
appropriation of the surplus value created with the unpaid labour of
the rank-and-file working people.

Just as all the other elements of the relations of production, the
relations of distribution, too, have degenerated completely. Just for
this reason, the new Soviet bourgeois can readily allow the workers to
keep in a drawer the text of the Soviet constitution, which legally
consecrates the right to common property, provided these bourgeois
themselves keep hold of the bank book in which the sums of deposited
roubles continually increase.

The whole of the surplus value appropriated by the Soviet bourgeoisie
assumes various forms. A large part of this surplus value is
transformed in various ways by this bourgeoisie itself, as the
collective owner of the means of production, into capital of the form
of state monopoly capitalism. This part, like the means of production,
it owns as a class and not as individuals. Another part of the
appropriated surplus value it distributes individually among the
members of its class in the form of the fat salaries and innumerable
bonuses, established for the new Soviet managers in recent years, which
are constantly increasing.

Suffice it to compare the second part of the surplus value appropriated
individually by the members of the Soviet bourgeoisie in the form of
“salaries and bonuses” with the wage of a rank and file worker, to
understand the entire exploiting character of the capitalist relations
of distribution in the Soviet Union. Today the salaries and bonuses of
the top Soviet managers (let alone the elite of the Party, State, army
and science) are 15-20 times higher than the minimum wage of ordinary
workers. Of course, in order to preserve its domination more easily.
The Soviet bourgeoisie, by means of bonuses, also corrupts a small part
of the working class, transforms it into an aristocracy of the working
class, as is the case in any capitalist society.

But the entire system of distribution operating in the Soviet Union
today, the colossal number of bonuses, which in some cases are entirely
unlimited, have nothing in common with the socialist principle of
distribution according to work, but under the label of the “recognition
of the special merits of managers”, serves the individual appropriation
by the new bourgeois of a part of the surplus value produced with the
unpaid labour of the Soviet workers. Precisely on this background we
have the growth of the social contrast: On the one hand, the class of
the new Soviet bourgeoisie, leading a fabulous luxurious life, and, on
the other hand, the rank and file working people who live in such
poverty that, as the Soviet newspaper “Socialisticheskaya Industria”
unintentionally let out a few years ago, only now are they replacing
their wooden spoons with metal spoons! It could not be otherwise. It is
true that immediately after he came to power, Khrushchov promised
golden spoons to everybody, but by the word “everybody” he implied only
the new Soviet bourgeoisie, which became the masters of the state power
and the means of production, while the others were reckoned to become,
as they did, wage slaves.

The degree of exploitation of the workers in every capitalist economy
is measured with the norm of surplus value, which represents the ratio
of the surplus value to variable capital. The Soviet statistics of
these categories still preserve the so-called “socialist” terms and
falsify the amount of variable capital, by including the salaries of a
part of the new Soviet bourgeois, which, as we said, represent a part
of the surplus value. But even from those figures “fiddled” by the
Soviet statistics, it emerges that the norm of exploitation of the
Soviet working class in 1972 was 23 per cent greater than in 1960. Such
is the “gain” of the Soviet working class from the so-called
construction of communism (read: restoration of capitalism).

4

The restoration of capitalism in the Soviet Union also brought
about the replacement of all the socialist economic laws and categories
with the capitalist ones. The process of the restoration of capitalism
extended over a number of years, which were also the years of the
extension of the operation of capitalist laws and categories, until
they reached their complete and final state.

The fundamental law of the present day Soviet economy is the law of
drawing maximum profits. One of the aspects of its manifestation in
practical activity consists in the fact that the entire activity of
Soviet enterprises is evaluated from the main index, which is the
so-called “profitability on funds” (read: profitability on capital).
The Soviet revisionists may engage in demagogy as much as they want,
claiming that the aim of their production has remained the fulfilment
of the needs of the working masses, however it is not words that are
important, but deeds. As long as the fat bonuses of the new Soviet
managers depend only on the “profitability on funds”, everybody
understands that, in order to fill their pockets, they do their utmost,
not to fulfil the needs of the economy and the working people, but to
increase their bonuses. Their motto is precisely the old Russian
saying, “Svoja rubashka blizhe k tjellu” (my shirt is closest to my
body).

The only regulator of Soviet production is the law of value and market
spontaneity. Volume of sales is the second index for evaluation of the
work of Soviet enterprises. But the volume of sales is directly
determined by the situation of the market; therefore, it is precisely
this market spontaneity that regulates Soviet production, and not the
“plan” as they prattle. For sake of appearances the Soviet revisionists
may play comedies and “criticize” the so-called “market socialism” of a
certain Otto Schick, but they themselves have long ago established
market capitalism.

The distribution of investments in the Soviet Union today, is done
according to the so-called “normative coefficient of capital
investments”, which is nothing but a “socialist” label for the average
norm of profit. The category of the capitalist price of production, for
which the revisionists find a thousand and one “socialist” names and
justifications, is operating in the entire Soviet economy. Through the
decentralisation of prices, which are fixed by the enterprises
themselves, “escalated prices”, etc., etc., the free play of prices is
fully operative, although in other forms. The capitalist category of
interest on capital has been established in the entire economy.

The struggle of individual enterprises for the most favourable
conditions for the creation of incentive funds, for the most
advantageous credit and capital, for a more profitable structure of
assortments, etc., is nothing but a form of competition operating in
the capitalist economy. Through uniting, merging, and transferring the
activities of individual enterprises, the Soviet revisionists conceal
the processes of the bankruptcy of individual capitalist enterprises,
but in fact, this bankruptcy exists. Many Soviet enterprises today have
landed in a bankrupt financial situation. During the 1965-1971 period,
the bank loans alone not repaid on time by the enterprises increased
2.3 times. During the period 1966-1970, violation of the normal
time-limit for the liquidation of obligations by Soviet enterprises
increased by 25 per cent, while the total of all the obligations not
paid on time increased by 78 per cent.

The complete restoration of capitalism in the Soviet Union could not
fail to bring about the fabulous enrichment of the new bourgeoisie, the
impoverishment of the working masses, continuous economic failures,
unemployment and crises, manifested in hidden forms, and other
capitalist phenomena.

To show the disastrous consequences of the restoration of capitalism in
the Soviet economy, we shall mention only the marked decline of the
rates of economic development in comparison with the time when
socialist economy still existed. Thus, in comparison with the
1945-1960 period, the average rate of increase of national income in
the
Soviet Union in the years 1960-1965 dropped by 44 per cent, in the
years
1965-1970 it dropped 35 percent, and in 1974 it dropped 58 per cent.
And
it must be said that the rates of economic development calculated by
the Soviet statistics contain in themselves the colossal increase, in
recent years, of Soviet military production, and if this were excluded,
the situation of crisis and the real Soviet economic decline would be
even more pronounced.

All analysis of real facts shows very clearly that the Soviet economy
today is completely and definitely a capitalist economy. It is
precisely this economy which constitutes the basis of Soviet
social-imperialism, which is characterized in the internal field by
savage exploitation of the working people; by antagonistic class
contradictions, by phenomena of decline and successive crises,
unprecedented militarization, etc., while in the external field it is
characterized by expansion, not only political and military, but also
economic; by the exploitation of other countries, and primarily, of the
East European “allies”.